2005 Texas Insurance Code CHAPTER 226. UNAUTHORIZED AND INDEPENDENTLY PROCURED INSURANCE PREMIUM TAX

INSURANCE CODE

CHAPTER 226. UNAUTHORIZED AND INDEPENDENTLY PROCURED INSURANCE 
PREMIUM TAX

SUBCHAPTER A. UNAUTHORIZED INSURANCE PREMIUM TAX


	§ 226.001. DEFINITIONS.  In this subchapter:                                
		(1)  "Insurer" has the meaning assigned by Section 
101.002 and includes:    
			(A)  an insurer that does not hold a certificate 
of authority in this state;
			(B)  an eligible surplus lines insurer;  and                                 
			(C)  an insurer that holds a certificate of 
authority in this state.       
		(2)  "Premium" includes any consideration for 
insurance, including:         
			(A)  a premium;                                                              
			(B)  a membership fee;                                                       
			(C)  an assessment;  or                                                      
			(D)  dues.                                                                   

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.  
Amended by Acts 2005, 79th Leg., ch. 728, § 11.005(a), eff. Sept. 
1, 2005.


	§ 226.002. APPLICABILITY OF SUBCHAPTER.  This subchapter 
applies to an insurer who charges gross premiums for insurance on a 
subject resident, located, or to be performed in this state.

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.  
Amended by Acts 2005, 79th Leg., ch. 728, § 11.005(b), eff. Sept. 
1, 2005.


	§ 226.003. TAX IMPOSED;  RATE.  (a) A tax is imposed on 
each insurer that charges gross premiums subject to taxation under 
this section.  The rate of the tax is 4.85 percent of the gross 
premiums charged by the insurer.
	(b)  Except as otherwise provided by this section, in 
determining an insurer's taxable gross premiums, the insurer shall 
include any premium for insurance on a subject resident, located, 
or to be performed in this state.
	(c)  If a policy covers risks or exposures only partially 
located in this state, the tax is computed on the portion of the 
premium that is properly allocated to a risk or exposure located in 
this state.
	(d)  In determining the amount of taxable premiums under 
Subsection (c), a premium, other than a premium properly allocated 
or apportioned and reported as a taxable premium of another state, 
is considered to be written on property or risks located or resident 
in this state if the premium:
		(1)  is written, procured, or received in this state;  
or                   
		(2)  is for a policy negotiated in this state.                                
	(e)  Insurance on a subject resident, located, or to be 
performed in this state is considered to be insurance procured, 
continued, or renewed in this state regardless of the location from 
which:
		(1)  the application is made;                                                 
		(2)  the negotiations are conducted;  or                                      
		(3)  the premiums are remitted.                                               
	(f)  Premiums on risks or exposures that are properly 
allocated to federal waters or international waters or are under 
the jurisdiction of a foreign government are not taxable by this 
state.
	(g)  The following premiums are not subject to the tax 
imposed by this subchapter:
		(1)  premiums on insurance procured by a licensed 
surplus lines agent from an eligible surplus lines insurer as 
defined by Chapter 981 on which premium tax is paid in accordance 
with Chapter 225;
		(2)  premiums on an independently procured contract of 
insurance on which premium tax is paid in accordance with 
Subchapter B;  and
		(3)  premiums on a contract of insurance written by an 
insurer that holds a certificate of authority in this state and that 
is authorized to write the contract.

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.  
Amended by Acts 2005, 79th Leg., ch. 728, § 11.005(c), eff. Sept. 
1, 2005.


	§ 226.004. TAX EXCLUSIVE.  The tax imposed by this 
subchapter is in lieu of all other insurance taxes.

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.          


	§ 226.005. TAX PAYMENT;  DUE DATE.  (a) The tax imposed by 
this subchapter is due and payable not later than:
		(1)  March 1 after the end of the calendar year in which 
the insurance was effectuated, continued, or renewed;  or
		(2)  another date prescribed by the comptroller.                              
	(b)  An insurer shall pay the tax imposed by this subchapter 
using a form prescribed by the comptroller.
	(c)  The tax imposed by this subchapter, if not paid when 
due, is a liability of the insurer, the insurer agent, and the 
insured.

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.  
Amended by Acts 2005, 79th Leg., ch. 728, § 11.005(d), eff. Sept. 
1, 2005.

SUBCHAPTER B. INDEPENDENTLY PROCURED INSURANCE PREMIUM TAX


	§ 226.051. DEFINITION.  In this subchapter, "premium" 
includes any consideration for insurance, including:
		(1)  a premium;                                                               
		(2)  a membership fee;  or                                                    
		(3)  dues.                                                                    

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.          


	§ 226.052. APPLICABILITY OF SUBCHAPTER.  This subchapter 
applies to an insured who procures an insurance contract in 
accordance with Section 101.053(b)(4).

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.          


	§ 226.053. TAX IMPOSED;  RATE.  (a) A tax is imposed on 
each insured at the rate of 4.85 percent of the premium paid for the 
insurance contract procured in accordance with Section 
101.053(b)(4).
	(b)  If an insurance contract covers risks or exposures only 
partially located in this state, the tax is computed on the portion 
of the premium that is properly allocated to a risk or exposure 
located in this state.
	(c)  Premiums for individual life or individual disability 
insurance are not included in determining an insured's taxable 
premiums.

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.          


	§ 226.054. TAX PAYMENT BY CERTAIN INSUREDS.  (a) Except 
as provided by Section 226.055, the tax imposed by this subchapter 
is due and payable not later than:
		(1)  May 15 after the end of the calendar year in which 
the insurance was procured, continued, or renewed;  or
		(2)  another date prescribed by the comptroller.                              
	(b)  An insured who fails to withhold from the premium the 
amount of tax imposed by this subchapter is liable for the amount of 
the tax and shall pay the tax due.
	(c)  The insured shall file a tax report and pay the tax.                      
	(d)  The insured may designate another person to file the 
report and pay the tax.

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.          


	§ 226.055. TAX PAYMENT BY CERTAIN CORPORATIONS.  The 
amount of tax due and payable under this subchapter by a corporation 
that files a franchise tax report shall be reported directly to the 
comptroller and is due:
		(1)  at the time the franchise tax report is due;  or                         
		(2)  on another date prescribed by the comptroller.                           

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.          


	§ 226.056. EFFECT ON OTHER LAW.  Sections 226.051-226.054 
do not abrogate or modify any other provision of this chapter or 
Chapter 101.

Added by Acts 2003, 78th Leg., ch. 1274, § 1, eff. April 1, 2005.